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AT&T Exits Pay Phone Business

Clark Kent will have to change somewhere else

By Mark Huffman
ConsumerAffairs.com

December 3, 2007 

As the venerable phone booth fades into history, AT&T says it will be completely out of the pay phone business by the end of 2008. It says it will honor existing contracts and customer service commitments until then.

The company said it plans to phase out both public pay phones and phones provided under contracts at prisons through the end of next year. All customers will receive advance notification of specific plans as well as information on other potential providers and product options.

Just to confuse matters, AT&T says the move affects only AT&T pay phones in what the company calls its "traditional 13-state service area" only, primarily the region formerly served by SBC.

BellSouth Corp., which was acquired by AT&T Inc. in late 2006, had previously exited the pay phone business in its nine-state service area. AT&T's wholesale pay phone services are not affected, the company said.

"This is the right time for us to take this step on behalf of our customers, employees and stockholders," said David Huntley, senior vice president for Customer Information Services. "We expect that independent providers will pick up much of this business, and, as we exit the business, we will be able to refocus our resources to areas that offer stronger growth potential and greater opportunity for the company."

Pay phones in the United States have declined across the industry from about 2.6 million phones in 1998 to an estimated 1 million phones today.

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